Navigating the Economic Landscape

Financial Crisis Inquiry Commission Subpoenas Goldman Sachs

Posted by Larry Doyle on June 7, 2010 3:32 PM |

Talk is cheap!!

Lloyd Blankfein can talk all he wants about how he will implement needed changes at Goldman but Lloyd, “actions talk, bulls&*@ walks.” Why am I calling Lloyd and the Goldman crowd out once again? The Wall Street Journal highlights, Crisis Panel Subpoenas Goldman Sachs,

The bipartisan commission investigating the U.S. financial crisis said Monday it issued a subpoena to Goldman Sachs Group Inc. for failing to provide information in a timely manner.

The congressionally created Financial Crisis Inquiry Commission said in a release that Goldman Sachs has failed to respond to a request for documents and interviews.

“Failure to comply with a Commission request is viewed with the utmost seriousness, as the Commission will not be deterred from getting desired information,” the release said.

A spokesman for Goldman said the firm has “been and continues to be committed to providing the FCIC with the information they have requested.”

The 10-member commission has held a series of hearings on the causes of the financial turmoil that peaked in the waning months of 2008 and beginning of 2009. Last week they heard testimony from investor Warren Buffett, among others, on the role that credit-rating firms played in market dislocations.

Is Goldman treating the request for information with the required sense of urgency or merely playing rope-a-dope with the FCIC and ultimately the American public?

I commend the FCIC for issuing the subpoena to Goldman but I wonder how and why it has come to that? I have seen no other requests for information resulting in subpoenas by the commission. The FCIC needs to share with America all of this information and expose Goldman Sachs in the process.

Will they?

I believe Goldman’s legal counsel has likely guided them in providing this information to the FCIC so as to minimize the impact on the lawsuit pending with the SEC. If Goldman’s reputation takes a further hit via this subpoena the legal counsel likely feels it is more than offset by a benefit accrued in the settlement of the SEC suit.

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